The Mudcat Café TM
Thread #84937   Message #1571137
Posted By: GUEST,petr
26-Sep-05 - 08:26 PM
Thread Name: BS: Thanks, Canada, for the oil....
Subject: RE: BS: Thanks, Canada, for the oil....
Exactly;
the Americans do not want to abide by the agreed upon system of settling disputes under the Nafta agreement. The last 5 Nafta panel rulings (made up of both Canadians and Americans) have ruled that the US side has not proven any damaging effect on the US lumber industry and that they do not have the right to put duties on Canadian lumber that duties should be returned. The Americans have balked at this and
suggest that Canada come to the table and NEGOTIATE an agreement
(essentially outside of Nafta). According to WTO Canada has now the right to invoke retaliatory duties.

(Im surprised you asked for links, because this has been the news in Canada for years, but it probably gets very little coverage in the US,
one does not have to search much though..

The issue of softwood lumber goes back well over a 100 years.
Canadian lumber comes primarily from crown land.
US lumber comes primarily from private land, and Americans claim
that the stumpage fee paid to the crown is below market value.

(Actually the issue is more complex, as the companies actually had to develop and maintain logging roads as well as re-plant logged areas.)
Also throughout the last 25 years or so, Canadian sawmills have spent quite a lot of money upgrading, and the Canadian dollar was quite low compared to the US dollar, so US lumber producers found it very difficult to compete (they hadnt upgraded).

If the US does not abide by NAFTA, one of the key agreements of NAFTA was access to Canadian oil, (Even Mexico refused to agree to this for its oil) Canada can establish its own strategic reserve and slap on a tariff on oil and gas exported to the US. (China would be quite happy to get some of it instead.)